Nov. 23 (Bloomberg) -- U.S. regulators should decide by the
middle of next year which derivatives clearinghouses should be
designated as systemically important, Commodity Futures Trading
Commission Chairman Gary Gensler said.

Gensler proposed the deadline today in a statement after
the Financial Stability Oversight Council voted in Washington to
seek comment on which clearinghouses should get the designation,
which could subject them to Federal Reserve supervision. The
council of regulators, created under the Dodd-Frank financial-regulation law, is determining which firms merit oversight
because of their potential to threaten the broader economy.

“It is my recommendation that we as a council be in
position to identify systemically important clearinghouses by
the summer of next year,” Gensler said in the statement. “This
will provide clarity to clearinghouses and market participants
as to the standards that they will have to uphold when the
mandatory clearing of standardized swaps becomes effective.”

The CFTC and the Securities and Exchange Commission are
leading U.S. efforts to revamp regulation of the $583 trillion
over-the-counter derivatives market after largely unregulated
trading complicated efforts to resolve the 2008 credit crisis.
The CFTC aims to complete most of its Dodd-Frank rulemakings by
July 15, Gensler said.

Derivatives are financial instruments used to hedge risks
or for speculation. They’re derived from stocks, bonds, loans,
currencies and commodities, or linked to specific events like
changes in the weather or interest rates. Options and futures
are the most common types of derivatives.